A few early adopters probably regretted their decision when the iPhone 3G was released. While the original iPhone was a game-changer that spurred forward a category often lacking in innovation, the iPhone 3G delivers several features that were much-needed (such as 3G connectivity) and some that were pleasant surprises (such as GPS mapping). So it's sad that the people who couldn't wait to get their hands on the original are still locked into their two-year contracts. Maybe for its next trick, Apple could do something about cell phone pricing models.

The iPhone's new features

The biggest omission in the original iPhone, and the biggest improvement this time, is 3G connectivity. That means you can load Web pages, download e-mails, and load maps much faster that with the original model. During weeks of testing the New York City area, we typically saw pages load as quickly as over our broadband network at home.

Apple's official reason for not including 3G on the original iPhone was that it took too great a toll on battery life, and it's true that this model has worse battery performance. It's rated for five hours of talk and 300 hours of standby. Plan on charging it every evening, especially if you watch video or play games. While someone who only makes occasional calls or listens to music can go two or more days between charges, people who use the 3.5-inch, 480 by 320 pixel screen often will find the battery draining much more quickly.

The iPhone is also making inroads to the workplace with this version, which includes support for Microsoft ActiveSync for push support of e-mail, contacts, and calendars. It also includes Cisco iPsec VPN support. We weren't able to test the workplace features, but we did test the iPhone with MobileMe, the successor to Apple's .Mac suite of online tools. [Click here for a full review of MobileMe.] When used with a MobileMe account ($99 per year), the iPhone sends and receives e-mail, contact, and calendar changes to and from the desktop. Add a contact in Apple Address Book on your desktop and it will show up on your iPhone in minutes, using over-the-air syncing. While it doesn't offer true push functionality, as Apple originally claimed, it's proven itself nearly as fast in our testing, syncing typically just a minute after a change.

The phone's GPS mapping won't replace a dashboard GPS navigation unit (it doesnt offer real-time turn-by-turn directions or 3D maps) but it does make it simple to find out your current location and get directions to wherever you want to go. It's always been accurate in our testing, showing our position to a half-block. Just as handy is how it works with other iPhone applications, showing, for example, a contact's location with just a tap. [For more on iPhones location-based technology, click here.]

The App Store

Just as impressive as the iPhone 3G itself is the App Store that launched along with it. Access the App Store either through iTunes or through the App Store icon on the iPhone and add whatever functionality you're missingoften for free.

The App Store offers thousands of small third-party applications that you can load onto your iPhone, and is organized into categories including News, Utilities, and Games. We love the variety and ingenuity of the apps. Some of our favorite freebies include Shazam (which can identify any song in seconds), Bloomberg (a fantastic market and stock tracker), and Pandora (which gives mobile access to custom radio stations).

Wish list

Impressive as this release is, we can't help wondering why the developers didn't deliver on some of the most glaring missing features. Why is there still no copy and paste function? Why can you still not send photos in instant messages? Why are to-do and memo features missing with the desktop syncing? And why doesn't the wireless syncing go even further, updating your music collection, for example, automatically?

While the iPhone 3G is cheaper than the original ($199 for the 8GB model and $299 for the 16GB model), AT&T, which is the only carrier in the U.S., has decided to increase the service rates. You'll now pay $129 per month for unlimited voice and data. Worse, AT&T doesn't give family plan discounts on iPhone service, as it does with other phones.

It's not just hype that's made the iPhone the hottest smartphone around. If you're due for an upgrade, take a good look at the iPhone 3G. The biggest downside is that you'll be locked into a two-year agreement and won't get whatever new model Apple will unleash next summer.